How well does Blender Rigid Body physics translate to real life
Blender rigid body physics is great for flat surfaces or for single point of contact collisions (eg, a coin falling onto a surface or a cube bouncing) but struggles with curved sufaces in full contact with other curved surfaces - such as an axle through a close fitting hole in a wheel. This is mostly due to the way in which the meshes are modelled - instead of being defined at an atomic scale they are simplified into vertices and faces that result in no ‘exact fit’. Also, the simulation is broken down into a series of short ‘steps’, but nothing compared to the (potentially) infinitely small number of steps in the real world. This means that closely fitting meshes quickly become unstable with overlapping meshes that the rigid body engine being unable to find a solution - so they start to pass through each other and jostle about as it tries to find the best solution in a situation that could not exist in the real world (real objects never get to the point where they physically intersect).

Theoretically, if you could model the surfaces using a high enough precision (unfeasibly high) and set the ‘steps per second’ to a high enough value (unfeasibly high) then you could get a reasonable simulation - but it would take far more time and computing resources than would be available.

Using Rigid Body Constraints allows you to simplify this by enforcing any relationships (such as a wheel moving around its axis) without having to rely on the microscopic interactions of the surfaces. This can generally produce a ‘good enough’ simulation for your needs.